Microsoft Shares Plunge 5% Post-Earnings Beat as AI Capex Crushes FCF; Dip-Buy Debate Ignites

Microsoft shares tumbled 4-5% to $400-408 after Q3 earnings beat with $4.27 EPS (vs $4.05 est.) and $82.9B revenue (vs $81.3B), driven by $30.9B AI capex (+84% YoY) slashing FCF 22% to $15.8B despite Azure's 40% growth and AI revenue surging 123% to $37B. Pre-earnings hype centered on 37-40% Azure forecasts, Strong Buy consensus, and $570-583 targets implying 34-40% upside from ~$429 levels, with options implying ±6.5-7% moves. A new huge customer win fuels buy-the-dip calls amid AI ROI concerns.